Swiss political parties holding the majority of the seats in Parliament have publicly laid out arguments in favour of the reform of the second-pillar pension system to draw a sceptical public to vote for the changes in the referendum set for 22 September.

The Green Liberal Party (GLP), the Evangelical People’s Party (EVP), the Centre (Die Mitte) party, the liberal party (FDP), and the Swiss People’s Party (SVP) have formed a coalition, laying out the benefits of the reform passed last year by Parliament in a media conference held yesterday.

“Thanks to the reform, part-time workers and people with low wages will receive a better pension,” said GLP’s member of parliament (MP) Melanie Mettler.

The proposed changes lead to strengthening and modernising the second-pillar system, looking at social and economic developments, the coalition added in a statement.

If approved in the referendum on 22 September, the reform will lead to cutting the wage threshold for joining a pension fund, increasing the share of insured wages, and reducing the conversion rate for pension payouts, which will be compensated by a lifelong pension supplement.

The reduction of the conversion rate remains one of the main points of discussion between those in favour and those opposing the reform, including unions, the Greens and the Social Democratic Party (SP).

The proposed conversion rate reduction has a “targeted effect and only applies to pension funds that have not already solved the problem”, according to the coalition in favour of the reform. Around 85% of pension fund members earn above the minimum wage and are not affected by the reduction, the coalition added in the statement.

The five parties hold 170 joint seats out of a total of 246 in Parliament, and their position could make a difference with the public that still has doubts on the benefits of the reform.

According to a survey conducted by media company Tamedia published today, 59% of the Swiss population rejects the reform proposal, including members of the SVP and Die Mitte parties.

ASIP, the country’s pension funds association, is backing the reform proposal, although its members would have preferred a “less generous option” in terms of compensations for those affected by the reduction of the conversion rate, director Lukas Müller-Brunner said in an interview.

“We want to somehow cushion immediate pension losses for those over 50,” he added.

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Luigi is IPE's Berlin-based DACH correspondent. His coverage includes regulation and the latest pensions and investments trends, and, being a native Italian, he also covers Italy’s pensions market. He has reported from Italy and Germany on international politics and business for European and US publications including USA Today, Bloomberg BNA and for the investigative magazine L’Espresso. He was previously Germany correspondent for Mergermarket covering M&A.View full Profile

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